Mr. and Mrs. Media Employee – Are You Ready for Your Three Or Four Day Working Week? At Least You’ll Still Keep Your Job, Maybe

Philip M. Stone December 4, 2008

When the UK’S mighty Financial Times that has really benefitted from higher readership because of the economic mess we’re all in tells its staff it welcomes offers from employees to reduce their working week to three or four days, advises that most salaries are being frozen for next year, and, by the way we’ll be very happy to consider staff redundancy requests, then that’s as good as proof as any that US traditional media is not alone in its suffering.

Anyone making more than £30,000 (around $45,000) will have their salary frozen for next year and while Chief Executive John Ridding admits that the Pink One is doing well against the competition the fact is that in such a down market that really doesn’t mean what it once used to. “With our customers and advertisers being affected we need to prepare for difficult times” -- (does that mean the times are not already difficult?) – and “We need to act early and decisively to reduce costs so that we can sustain our investment and our success,” Ridding told staff.

Actually the UK national newspapers are in high gear cost cutting mode – the FT is said to be considering plans to cut costs by 10% over the next two years – but over at News International the Q3 dismal earnings by parent News Corp., is already having an effect with Rupert Murdoch already on record saying his newspapers are going to have to tighten their belts even more. Boston Consulting has already been looking at every nook and cranny looking for savings and everyone at Wapping knows what that really means. It’s just a matter of when.

Already freelance editors have been hit. They used to work a 7 ¾ hour day (no doubt there are employment law reasons why it wasn’t a full eight hours) and for that they got £156 (around $235), but now with shift changes intended to make less use of such freelancers the working day is reduced to £120.75 ($180) for six hours – same hourly rate just less hours worked.

And over at The Daily Telegraph hardly a day seems to go by now without stories of long-time senior editors being told they no longer have jobs. Latest to go (as this is written) is the obituaries editor – obits play a role in the Telegraph like they do in the New York Times – they are often the best and most complete.

But perhaps the biggest shock came when the Independent newspapers that are really having a hard time of it these days, announced a physical move into the Daily Mail’s offices and there will be some sharing of back-room services.  The buzz on Fleet Street (can we still use that expression even if no one is there any more?) is just how much more co-operation there will be between the titles in the months to come.

The Independent’s physical move is as good an example as any of what American publishers are now openly saying – that they are now having discussions with people they never thought before they would be talking to, and they are making decisions that they never thought before they would even consider.

US newspapers, of course are on a rampage to cut costs wherever they can. The publisher of the Palm Beach Post (Cox, Florida) told employees this week, “We will not have increases for those top 150 employees who earn $65,000 or over (base pay or with commission) next year.” Frankly, what this writer found absolutely astounding about that announcement is that the newspaper, which has been cutting back staff galore, still actually has 150 employees making that kind of money!

Then there’s what is going on at those metropolitan newspapers that got bought in the past couple of years with the new buyers absolutely convinced that cash flow would easily take care of debt payments – they sure got that one wrong – and that means missed payments and creditors insisting upon even more cost-cutting measures if there is to be any hope of renegotiating the debt.

So, at the Minneapolis Star Tribune, where debt payments have been missed recently, and where employees agreed recently to $10 million in various cuts, now comes Publisher Chris Hartke telling staff that the creditors are insisting on much more savings, and, please, you need to give up another $20 million. If they don’t come up with the loot then into bankruptcy court goes the newspaper.

Even the mighty New York Times is not above having to find even more savings. It had previously announced it was quitting the distribution business and it now says that means 530 jobs will go and there’ll be a $53 million charge. It says it hopes to save about $30 million annually so all going well after two years it’s ahead of the game – except for what it costs for alternative distribution.

All of this leads up to Doom and Gloom week  being held in New York next week as UBS hosts its annual Media Days and CEOs of the major media companies will be telling us how they see 2009 – and that just has to be bleak, bleak, bleak. About the only company that will have something good to say is the Washington Post Company, not because the Post itself is doing so great; it’s not; but rather because the company’s educational business is doing so well. Last year Donald Graham spent most of his time explaining that the company was really an educational company  with more than 50% of the revenues now coming from education and the less said about the print side the better.

At the same meetings the cream of the advertising forecasters will be giving their prognoses for the coming year but as we have learned for the past few years that’s basically a waste of time. Their forecasts, as ftm has always complained, are always too ambitious and by summer come the first rollbacks, by the Fall the rollbacks are in full swing and by the end of the year we see just how badly they really got it wrong.

Not that we really blame the forecasters, for how can you see further than a month in this type of economic environment?